Employee Commitment to Organizational Change with the Role of Job Satisfaction and Transformational Leadership

This study aimed to analyze the role of job satisfaction and transformation leadership for employees’ commitment to organizational change. Based on a survey sample of 381 employees in post-merger enterprises in retail and pharmaceutical sector and a linear regression model.
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Employee Commitment to Organizational Change with the Role of Job Satisfaction and Transformational Leadership Technium Social Sciences Journal Vol. 2, 1-17, January 2020 ISSN: 2668-7798 www.techniumscience.com Employee Commitment to Organizational Change with the Role of Job Satisfaction and Transformational Leadership Nguyen Thi Bich Thuy Lac Hong University (Faculty of Administration-International Economics), Vietnam thuyntb@lhu.edu.vn Phan Dang Ngoc Yen Van Lac Hong University (Faculty of Administration-International Economics), Vietnam vanpdny@lhu.edu.vn Abstract. This study aimed to analyze the role of job satisfaction and transformation leadership for employees’ commitment to organizational change. Based on a survey sample of 381 employees in post-merger enterprises in retail and pharmaceutical sector and a linear regression model. The results revealed that Transformational leadership was associated positively and significantly with Affective Commitment (β = .42, p < .000), Normative Commitment (β = .32, p < .000), and Continuance Commitment (β = .27, p < .000); Job satisfaction was associated positively and significantly with Affective Commitment (β = .24, p < .000) and Normative Commitment (β = .30, p < .000) among employees’ to organizational change. The results of this study provide a foundation of theory and practice for organizational changes that can efficiently exploit the human resource for the development in the next period. Keywords. job satisfaction, organizational commitment, organizational change, transformational leadership, Vietnam Introduction Commitment is arguably one of the most critical factors involved in employees' support for change initiatives (Herscovitch & Meyer, 2002). In the context of vibrant economic development in Vietnam, where competition is taking place so fiercely that the result may be the acquisition of large businesses for smaller businesses that often take place (Hosseini, Thu, & Trang, 2017; Vuong, Napier, 1 Technium Social Sciences Journal Vol. 2, 1-17, January 2020 ISSN: 2668-7798 www.techniumscience.com & Samson, 2014). Mergers and acquisitions (M&As) have been a very popular strategic maneuver for global businesses, attaining growth, diversification, or profitability (Schweizer, 2005). While there are positive outcomes associated with M&A activity, such as growth and development, some of their disappointing results are associated with the mismanagement of the human side of it (Cartwright & Schoenberg, 2007). Organizational change, such as merger and acquisition (M&A) activity, continue to occur at a high rate in organizations (Herold, Fedor, Caldwell, & Liu, 2008). Even though 70% to 90% of these mergers and acquisitions fail, organizations continue to look for opportunities to merge (Cartwright, Tytherleigh, & Robertson, 2007; Pike, 2017; Raukko, 2009). There is undoubtedly a range of contributing explanations of these high M&As failure rates; however, recently there has been growing acceptance among management researchers that the neglect and mismanagement of the human aspects during and following the actual merger or acquisition are significant determinants of merger success or failure (Seo, Taylor, Hill, Zhang, Tesluk, & Lorinkova, 2012; Van Knippenberg, Martin, & Tyler, 2006). M&As have come to be associated with outcomes such as lower morale and job dissatisfaction, acts of sabotage, increased labour turnover and absenteeism rates rather than increased profitability (Armstrong-Stassen, Cameron, Mantler, & Horsburgh, 2001). There is a consensus that such change activities result in reduced organizational commitment among employees (Datta, Guthrie, Basuil & Pandey, 2010). Therefore, lowered commitment of employees after periods of mergers and change is identified as one of the reasons as to why the intended long-term effects of organizational change does not succeed (Cascio & Wynn, 2004; Van Dierendonck & Jacobs, 2012). Previous findings have indicated the potential importance of assessing employees’ psychological contracts during a merger, in order to reach both the desired organizational outcomes and employee job satisfaction (Bellou, 2007; Shield, Thorpe, & Nelson, 2002). Organizational commitment and its determinants have received considerable attention from scholars with many studies, and explanatory factors tested to predict the commitment behaviour of employees with organizations (Chua et al., 2014; Currivan, 1999; Enache, Sallán, Simo, & Fernandez, 2013; Igbal, 2010; Firth, Mellor, Moore, & Loquet, 2004; Irving, Coleman, & Cooper, 1997; Kumasey, Delle, & Ofei, 2014; Meyer & Allen, 1991; Mowday, Steers & Porter, 1979; Rutishauser & Sender, 2019; Saha, 2016). In the case of M&As enterprises, employees experienced several unmotivated feelings, attitudes, and commitment behaviour to the new system (Bellou, ...